In the revitalization plan details of auto industry to be issued at end of February, one subsidy policy “auto to countryside” of Rmb5bn will be included. Then how will it influence listed companies?
As estimated, the subsidy will account for ~ 10%-14% of the auto price.
Benefited from the subsidy, light truck and minibus will see ~ 10% and ~ 20% sales growth.
“Auto to countryside” policy can hardly improve earning of related companies sharply.
Investment portfolio: Light truck manufacturers like Beiqi Foton Motor (600166), Dongfeng Automobile (600006), Anhui Jianghuai Automobile (600418), Shenyang Jinbei Automotive (600609) and Dongan Heibao (600760); minibus manufacturers like SAIC Motor (600104) and Chongqing Changan Automobile (000625); and accessories providers for light truck and minibus, like Harbin Dongan Auto Engine (600178) and Kunming Yunnei Power (000903).w Listed Companies Benefit from “Auto to Countryside” Policy? --- Neutral